Verizon's $9 billion bet on the digital media business may rank among the worst blunders in the history of corporate America. Unfortunately, extracting itself from the bad deals won’t be easy.

Selling its Oath digital properties, including HuffPost, AOL and Yahoo, isn’t realistic in the wake of Verizon’s decision to take a $4.5 billion writedown on the business, effectively rendering it worthless. Spinning Oath off would also be difficult because few investors would be interested in buying shares in a company that accounts for roughly 3% of all online advertising sales. Moreover, Oath's rivals, including BuzzFeed, Vox Media, and Vice, are facing challenges similar to Oath's from the Facebook-Google duopoly, which controls more than half of all online ad spending.

Verizon has little choice but to make the best of a bad situation. According to the Wall Street Journal,Verizon executives “are exploring ways to supplement weaker-than-expected advertising revenue and potentially wind down some AOL or Yahoo brands.” Additional layoffs beyond the 10,400 workers who have voluntarily agreed to leave are likely in the works.

When Verizon acquired AOL for $4.5 billion in 2015, it had about 4,500 employees. Yahoo had about 4,600 full-time workers at the time of its $4.83 billion sale in 2017. According to Verizon, there were more than 11,000 Oath workers as of the end of the third quarter. The wireless giant's total workforce is about 155,400.

"We are committed to Oath's success, and yesterday's 8K disclosures speak for themselves," writes Bob Varettoni, a spokesman for Verizon, in an email.

Telecom experts, including independent analyst Jeff Kagan, were skeptical about Verizon’s move into digital media from the start. In an interview, Kagan noted, “I felt like at the time that it made absolutely no sense to me, and it still makes no sense.”

The main champions of the AOL and Yahoo deals were Tim Armstrong, the onetime head of AOL, and former chief executive Lowell McAdam — both of whom are no longer with the company. (McAdam is serving as executive chairman of the board through the end of the year and then will become non-executive chairman, according to Variety.)

Armstrong made the unusual decision to remain with AOL after its acquisition by Verizon. According to media reports, Armstrong tried and failed to persuade the company to spin out Oath, with him presumably in charge. Hans Vestberg, McAdam’s successor as CEO, also isn’t keen on the media business for understandable reasons.

For the first nine months of 2018, Oath’s operating revenue was $5.6 billion, roughly 6% of Verizon's overall revenue of $96.6 billion during that same time period. Verizon doesn’t report Oath’s profitability separately, although it has indicated that the business is operating in the red. It doesn’t expect Oath to reach the company’s annual revenue target of $10 billion by 2020.

“The leadership team at Oath is focused on returning to revenue growth by completing the integration of the legacy AOL and Yahoo! advertising platforms by year-end, implementing initiatives to realize synergies across all of our media assets and building services around our core content pillars of sports, news, finance, and entertainment,” Verizon chief financial officer Matthew Ellisnoted during Verizon’s third-quarter earnings conference call in October.

Unfortunately, integrating the AOL and Yahoo advertising technology platforms proved more difficult than expected and still isn’t complete, according to the Journal. Verizon executives also balked at sharing wireless subscriber data that would have helped them target their ads more effectively, the newspaper said.

Updates post to add comment from Verizon. Clarified details on the potential layoffs on December 20.